Rival Finalto bidder urges Playtech to postpone general meeting and sale vote

Gopher Investments has put pressure on Playtech to adjourn its upcoming general meeting where shareholders are expected to vote on the $210m (£180m) sale of Finalto to a consortium led by Tel Aviv-based private equity firm Barinboim Group. Gopher Investments submitted a rival $250m bid for Playtech’s Finalto financial division on 2 July. Despite the offer being more substantial, Playtech said it was bound by restrictions due to the advanced stage of sale discussions with Barinboim Group and that Gopher should have solidified its interest before 29 June to have a realistic chance of purchasing Finalto. Hong Kong-based Gopher has now urged Playtech to postpone the general meeting scheduled for 15 July and instead negotiate with the fund over its superior bid. “Gopher urges the board to adjourn the general meeting and engage in discussions with Gopher to proceed towards a recommended transaction that delivers materially better value to Playtech’s shareholders,” said the firm. “An adjournment of the general meeting for a short period of time does not preclude the board from proceeding with the consortium’s (Barinboim) offer and provides both the board and shareholders with optionality.” Should the general meeting go ahead as planned, Gopher is advising shareholders to vote against the original Barinboim offer, paving the way for fresh negotiations between the two parties. Gopher has already conducted a preliminary assessment of regulatory consent and is confident that it would receive approval in each jurisdiction. “Gopher envisages entering into an agreement on materially equivalent terms and believes transaction documentation can be entered into very quickly,” said the fund. Playtech proxy adviser ISS changed its voting recommendation on 5 July by recommending that shareholders vote against the Barinboim offer despite originally backing the proposal. ISS stated: “Given that the board asserts its inability to engage with third parties, the fact that there is no urgency to sell the business, and that the valuation of the original deal, as highlighted in our report, appeared low, the downside of rejecting the present transaction and the Gopher proposal not going ahead appears limited. “As such, a vote against the proposal is warranted.”